NTL joins unbundling bandwagon

NTL, the UK cable operator, is to spend up to £65m on installing its kit in BT exchanges to provide telecoms services direct to customers. It has its eye on up to 300 BT exchnages in a move that would mean it could provide its services to around 10m homes in the UK. The "last mile" investment is expected to take two years to complete, although 50 exchanges could be up and running by the end of March 2005.

NTL chief exec Simon Duffy told the Financial Times, that it's cheaper to invest in local loop unbundling (LLU) than physically rolling out cable to extend its own network.

Last week, Cable & Wireless announced its plans to plough up to £85m into local loop unbundling (LLU) over the next couple of years as it ramps up its investment in broadband. It is to unbundle up to 400 exchanges in the second half of 2005 as it targets around a third of BT's exchanges.

Wanadoo UK, the France Telecom subsidiary, has already signalled its intent to invest in LLU to provide services such as voice over broadband and video-on-demand direct to end users. Work on Wanadoo's LLU plans are unlikely to begin until next year.

In April this year, Ofcom signalled its enthusiasm for LLU to play a greater role in stimulating competition in the wholesale broadband sector. Ofcom chief exec Stephen Carter hinted that the regulator would act to make LLU more attractive to rival operators, to bring genuine wholsale competition to the UK.

Since then, the price of LLU for operators has fallen by around 70 per cent, bringing it in line with costs in the rest of Europe. ®